FOREVER NATURAL Frequently Asked Questions

What is meant by the term “Green Infrastructure?”

Green Infrastructure is a concept that highlights the importance of the natural environment in decisions about land use planning. It includes strategically planned and managed networks of natural lands, working landscapes and other open spaces that conserve ecosystem values and functions and provide a wide array of benefits to people and wildlife. There is an emphasis on the "life support" functions provided by the natural environment such as clean water and healthy soils. The Environmental Protection Agency has extended the concept to apply to the management of stormwater runoff at the local level through the use of natural systems, or engineered systems that mimic natural systems, to treat polluted runoff.

What is a “conservation agreement” and how can it be used?

A conservation easement is a written agreement between a landowner and a qualified conservation organization or a public agency, in which:
• The landowner (grantor) promises to keep the land in its natural condition without extensive disturbance, and
• The conservation organization or public agency (grantee) is granted the right to enforce the covenants of the agreement and to monitor the property.
There are different types of conservation agreements and they go by several different names. They can be called “conservation easements,” a grant of “development rights,” a “historic preservation agreement,” a “farmland agreement,” or a “working lands” agreement. In any case, they are intended to preserve property in its natural, undeveloped condition to provide public benefits by conserving open space, water quality and significant natural areas. Because the benefits are “public” in nature, tax incentives are available for the donating landowner. There may also be grants available for the purchase of conservation agreements from landowners on certain eligible lands. Conservation agreements can be individually tailored to suit the objectives of the landowner and the conservation organization or public agency. The terms of the agreement may, or may not, include accessibility for the general public.

Why are “working forests” important to preserve?

Forest lands provide critical social, economic, and ecological benefits to our communities, including aesthetic and spiritual values, recreation opportunities, fresh drinking water, clean air, timber and forest products, and wildlife habitat. According to recent research, the U.S. Forest Service manages approximately 20 percent of our nation’s forests. Nationally, private landowners manage approximately 57 percent of our forests, and state and local agencies manage approximately 23 percent of our forests. North Carolina ranks fourth nationally in area of privately-owned forests (behind Alaska, Georgia and Alabama). All of these forests can be compromised by inappropriate development in and adjoining their boundaries – leading to reduced management options and private property damage (such as wildfire). Recent problems also include the introduction of exotic species (plant and animal) and fragmented wildlife habitat.

What are the benefits of “collaborative” land use decision-making?

The most effective conservation strategies are regional in nature – and should be undertaken collaboratively between public and private sectors. By developing interpersonal and interorganizational linkages, managers and citizens can be better informed and make choices that are more likely to solve the problems at hand. Programs are more likely to be implemented successfully if they are supported and owned by affected groups. Collaborative decision-making and on-the-ground partnerships can enhance the capacity of agencies and communities to deal with problems in the future, leading to higher levels of meaningful conservation strategies.

WORKING LANDS Frequently Asked Questions

What does the term "working lands" mean?

North Carolina's working lands include farm land and forest lands that produce economic benefits for the landowner, while preserving environmental benefits. Many partners are working with landowners to keep land in private ownership and in a working state as a means of achieving conservation purposes.

What tools and programs are available to help slow and stop the loss of farm and forest land?

• Conservation Easements
• County Farmland Protection Plan
• Voluntary Agriculture Districts
• Enhanced Voluntary Agriculture Districts
• Transfer of Development Rights
• Purchase of Development Rights
• Cost of Community Services Study
• Local Farmer Markets
• Cost Share Programs
• State Trust Fund grants
• Present Use Value Taxation
• Agritourism

Can I get money, or other compensation for protecting my land from being developed?

Yes! North Carolina landowners have access to a wide range of programs that can help them achieve their goals of conserving natural resources and increasing the economic viability of their farms. Funding for these programs comes from federal and state agencies, and eligibility varies widely by county, region and type of farm. For detailed information about various landowner options, click here.

How do we get a Voluntary Agriculture District Ordinance (VAD) in my county? What will a VAD mean for us?

A Voluntary Agriculture District ordinance has been adopted by 62 counties, because it provides many benefits to landowners. Voluntary Agriculture District ordinances must be passed by a majority vote of the county commissioners. A grass roots effort is often successful, but VAD assistance is recommended to develop an appropriate strategy for your county. For detailed information about getting a VAD in your county, click here.

 

WORKING WATERS Frequently Asked Questions

What is the CHPP?

The Coastal Habitat Protection Plan describes the habitats for coastal fisheries resources in eastern North Carolina, threats to those habitats, and management actions to address those threats. The CHPP identifies four goals for protection of coastal fisheries habitat:
1) Improve effectiveness of existing rules and programs protecting coastal fish habitats
2) Identify, designate, and protect all Strategic Habitat Areas
3) Enhance habitat and protect it from physical impacts
4) Enhance and protect water quality

The CHPP is built around six basic habitats used by coastal fishery species: water column, shell bottom, submerged aquatic vegetation (SAV), wetlands, soft bottoms and hard bottoms. Within each of the specific habitat chapters of the CHPP, there is detailed information on the habitat’s description, distribution, ecological role and functions for finfish and shellfish species (primarily fishery species, but also forage and protected species), status and trends, threats, and management needs. The “management needs” includes regulatory, enforcement, research, monitoring and restoration activities affecting coastal fish habitat.

Why is it needed?

The purpose of the Coastal Habitat Protection Plan as provided by the North Carolina General Assembly is the, “long-term enhancement of coastal fisheries associated with each coastal habitat.”

What has been accomplished?

Accomplishments are detailed in several CHPP Annual Reports.

What research needs are identified in the CHPP?

More than 100 research needs have been identified in the CHPP. A detailed listing of research needs is provided in the CHPP Needs Report.

STEWARDSHIP PROGRAM Frequently Asked Questions

How often should a property be inspected?

Monitoring inspections should be conducted once a year, within a specified schedule: Year One should occur within 334-455 days of closing on the property. Year Two should occur 270-445 days after the previous monitoring. Inspections will continue on an annual basis within a 45-day window of the previous year's date.

Who is authorized to conduct monitoring inspections?

The Stewardship Program authorizes representatives of the land trust associated with acquisition of the property, or staff with the local Soil and Water Conservation District.

Who should I contact if I am interested in donating a conservation property or easement to the state?

Contact the Stewardship Program director Eric Galamb at (919) 707-8109.

Is there a letter authorizing the land trust representative to enter the property to conduct an inspection?

A letter from the Stewardship Program director to the property owner is available here.

What is a Baseline Documentation Report?

A sample Baseline Documentation Report (BDR) is available here.

What are the Endowment fees for properties and easements donated to DENR?

Effective July 1, 2011, the Endowment fee is $1,076/acre per 15A NCAC 02R .0402. Endowment fees will increase every July.

SUSTAINABLE DEVELOPMENT Frequently Asked Questions

How do you define Sustainable Development?

The most commonly used definition was developed by the Bruntland Commission for the United Nations: Sustainable development is the ability to make development sustainable - to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs.

What are the main pillars of sustainable development?

The Johannesburg Declaration of the 2002 World Summit on Sustainable Development speaks of "a collective responsibility to advance and strengthen the interdependent and mutually reinforcing pillars of sustainable development - economic development, social development and environmental protection - at local, national, regional and global levels."

How is sustainable development being addressed in North Carolina?

In North Carolina, we have developed the Conservation Planning Tool to coordinate and guide compatible land use planning and inform future growth patterns while preserving natural habitat that enhances quality of life. Place-based economic development is a promising strategy used by a growing number of communities in North Carolina to build a sustainable local economy using the local natural resources. Green building techniques allow development of homes and communities while lessening the environmental impacts. Conservation and preservation programs ensure healthy environments that provide clean air and water, local food and opportunities for recreation for North Carolina residents.

CONSERVATION TAX CREDIT PROGRAM Frequently Asked Questions

Consult General Statues 105-130.34 and 105-151.12 for the specific requirements of the Conservation Tax Credit Program.

• For answers to additional questions about the Conservation Tax Credit certification process administered by the N.C. Department of Environment and Natural Resources call (919) 707-8110.

• For answers to additional questions about the Conservation Tax Credit filing process administered by the N.C. Department of Revenue call: (877) 252-3052 for individual income taxes or for corporate income taxes.

What are the tax advantages of a donation of interests in real property for conservation purposes?

For federal tax purposes, the donation may be claimed as a charitable contribution. For state tax purposes, the donation counts as a charitable contribution, and can also be claimed as Conservation Tax Credit. Other tax advantages may also result, including reduction or avoidance of capital gains, estate, and property taxes.

How does a tax credit compare with the charitable contribution allowed for other types of gifts?

The value of a charitable contribution is subtracted from the filer's taxable income before the calculation of taxes owed, while the tax credit is subtracted directly from taxes owed.

How does the N.C. Department of Environment and Natural Resources determine that a conservation benefit will result from a donation of interests in real property?

For conservation easements, the distribution of rights are reviewed to determine whether conservation benefits can be certified. In the case of a fee simple donation, the determination is simplified if the deed specifies that the transaction is being undertaken in expectation of qualifying the grantor/donor for a tax credit under the Conservation Tax Credit statutes, and noting one or more of the required conservation purposes to describe the intended conservation use.

Do bargain sales of interests in real property for conservation tax purposes qualify for a Conservation Tax Credit?

The donated value that results from a bargain sale is eligible for application to a Conservation Tax Credit.

Will a donation of interests in real property for conservation purposes made through a charitable remainder trust (CRT) qualify for a Conservation Tax Credit?

A donation made through an irrevocable CRT will be eligible for a Conservation Tax Credit in the year of its creation. A donation through a revokable CRT will not be eligible until the interests in real property are transferred to the donee.

Would a golf course donation be eligible for the conservation tax credit?

The Attorney General’s office has provided an informal opinion that the use of land for golf courses is not entitled to certification of a public benefit under either N.C.G.S §105-130.34 or N.C.G.S. §105-151.12. This relates to tees, fairways, traps, greens, areas for in-bounds play, cart paths, and any other areas modified for golf course use.

When should the real property appraisal required to support a claim for Conservation Tax Credit be completed?

The N.C. Department of Revenue advises that the appraisal must be conducted by a licensed appraiser at a time that would insure that it reasonably estimates the fair market value of the gift at the time of the donation. Since the same appraisal might be used for federal income tax purposes, IRS regulations should also be consulted.

How is the value of a conservation easement determined?

Easements are typically valued by a before-and-after appraisal. That is, the value of the real property before the easement, minus the value after the easement, equals the value of the easement.

Can a Conservation Tax Credit be received for a donation made for a specific length of time, such as 20 years or 50 years?

The N.C. Department of Revenue advises that to be eligible for the Conservation Tax Credit, donations of interests in real property must be made in perpetuity.

Can reversion interests be included in a gift transaction and still qualify for a Conservation Tax Credit?

When the donor has reason to include a reversion interest, it must be supportive of the requirement that conservation benefits result from the transaction. Therefore the N.C. Department of Environment and Natural Resources cannot certify the conservation benefits of a real property donation unless the potential reversion interest recipients are "qualified recipients," as required by general statute.

Is land or interests in land donated for conservation purposes under the Conservation Tax Credit Program protected from condemnation that would lead
to conversion to non-conservation uses?

No. The Conservation Tax Credit statutes provide no protection in addition to those that may already apply to any specific conservation site by virtue of other laws.

What do reviewers look for in applications?

What do reviewers look for in applications? There are the reviewer guidelines, so please check those first. In addition, clear and straightforward instruments of transfer are not only helpful in the review process, but also should make it easier to monitor and steward the property in perpetuity. Where there are retained rights, the reviewers look for a balance that provides adequate conservation of the environment and natural resources.

Other things that get extra scrutiny from reviewers:
•Reserved home site and/or subdivision resulting in fragmentation
•Inadequate conservation of water quality or other sensitive/important habitats
•Multiple retained rights which could or would degrade conservation value if exercised
•Provisions for alteration in retained rights (e.g. conversion of existing forested habitats to agricultural purposes or conversion of agricultural land to developed areas; impoundments of free-flowing streams)
•Retained rights with potential off-site impact, such as changes to natural hydrology
•Retained rights with no review by grantee
•Size, shape and configuration of conservation area
•Substitution of property is not reviewed favorably. The conservation intent of donation would imply that important resources are protected from the beginning.

Would a smoke easement be eligible for Conservation Tax Credit?

Prescribed fire is a public benefit for a number of reasons, including safety through hazard reduction. The greatest interest to the Conservation Tax Credit Program is in providing the benefit to habitat conservation. Smoke easements demonstrate an interest in, or indicate the landowner’s commitment to, habitat conservation. Agreements, or the terms of such an agreement, would be encouraged in all conservation easements, especially those near conservation lands. Check with the North Carolina Prescribed Fire Council for examples of smoke easements.

Would a project that received approval -- or even some limited funding for transaction costs -- from another program be eligible for tax credit?

The project may be eligible, but it should be noted that approval and/or funding by other government agencies or funding sources does NOT guarantee DENR certification of public benefit for tax credit.

Can a home site be reserved within the conservation area and still get the tax credit?

This is a difficult question, but the reviewers have worked to identify an approach to take in this regard. Below is the general rule for a reserved home site – in order of preference:
1. Prefer to exclude the reserved home site from the conservation area.
2. In the cases where there is some practicality for a home site to be within the conservation area, and the home site is reserved in the corresponding easement, reviewers prefer that that the location be specified. Reviewers will examine location, footprint/envelope, impervious surface, building square foot/height, as well as reservations for access road and utilities and other associated retained rights. Prescribed caps or limits will help reviewers evaluate impact on conservation values. Reviewers would expect impact to be minimal, and the recipient (easement holder) to have right of review before construction.
3. Easements where a home site is reserved in the conservation area, but the location is not identified as part of the conservation easement will be evaluated as if the future home site will be located in the least ideal location (e.g. prime farm fields, within stream buffers, on rare plant populations, or situated to maximize fragmentation of wildlife habitat).

Some programs have a rule of thumb for the number of reserved home sites (e.g. for USDA Farm and Ranchland Protection Program, one home site per the average size farm in the area, which usually translates to one home site per 50-100 acres). Of course, fragmentation is a great concern for wildlife habitat, so home sites will be carefully evaluated in non-farmland projects.